Lead Manager

BABCOCK & BROWN PROSPECTUS
Depreciation periods are:
New asset
Used asset
Aircraft 25 years 25 years less current age
Railcars 25 years 25 years less current age
(j) Real Estate
Real estate acquired for development and sale in the ordinary course of business is carried at cost to date,
including borrowing costs incurred.The net realisable value of each holding is assessed at each reporting period
and a provision for diminution in value is raised where cost (including costs to complete) exceeds net realisable
value.
(k) Semiconductor Equipment
Semiconductor equipment are assets that are purchased for the purposes of trading.These assets are recorded at
the lower of cost or net realisable value.
(l) Property and Equipment
All classes of property and equipment are measured at cost and depreciated using the straight-line method over
the estimated useful life.
Costs incurred in the design and installation of internal use software are capitalised at cost and depreciated over
the estimated useful life of the asset.
Major depreciation periods are:
Furniture and Fixtures
Leasehold improvements
Computer Software and Equipment
2003
7 years
The lease term
3 to 5 years
(m) Assets Under Development
Assets under development are recorded at the lower of cost or net realisable value and will be transferred to the
appropriate class of asset when the development is completed and the asset is ready for use.Where the asset is a
qualifying asset cost will include any capitalised borrowing costs.
(n) Intangible Assets
As discussed in the pro-forma adjustments at note 2, goodwill represents the excess of the purchase consideration,
being the fair value of shares issued to effect the acquisition, over the fair value of the net assets acquired at the
date of the transaction.
Goodwill is amortised on a straight-line basis over the period during which the benefits are expected to arise.
This is expected to be the maximum permitted period of 20 years.
(o) Recoverable Amount
The recoverable amount for all non-current assets carried at cost is assessed at each reporting date.The
recoverable amount of an asset is the net amount expected to be recovered through the cash inflows and outflows
arising from its continued use and subsequent disposal.These cash flows have not been discounted to their
present value.
Where the carrying amount of a non-current asset is greater than its recoverable amount, the asset is written
down to its recoverable amount.Where net cash inflows are derived from a group of assets working together,
recoverable amount is determined on the basis of the cash flows of the relevant group of assets. Any provisions for
recoverable amount write-down are included in the statement of financial performance in the period in which
the recoverable amount write-down occurs.
179